HBIO Reports 53% Revenue Growth in Fourth Quarter Before FX Effects
HOLLISTON, Mass., Mar 3, 2003 (BUSINESS WIRE) -- Harvard Bioscience, Inc. (Nasdaq: HBIO), today reported financial highlights for the three and twelve months ended December 31, 2002.
Revenue for the fourth quarter of 2002 grew 53% from the same quarter in 2001 before favorable foreign exchange effects. Including foreign exchange effects, revenue for the fourth quarter grew 59%, to $18.9 million from $11.9 million. Pro forma net income totaled $1.5 million or $0.05 per diluted share compared to $1.1 million or $0.04 per diluted share in the fourth quarter of 2001. Pro forma net income excludes, for all periods presented, stock compensation expense, amortization of intangibles, and charges related to restructuring, net of tax effects. For the three and twelve months ending December 31, 2002, related to the acquisition of Genomic Solutions, pro forma net income additionally excludes, net of tax, acquired in-process research and development expense and fair value adjustments, expensed through cost of product sales, for acquired inventory and backlog related to orders shipped since the acquisition. For the three and twelve months ended December 31, 2001, pro forma net income excludes, net of tax, amortization of goodwill. For the twelve months ended December 31, 2001, pro forma net income excludes the write off of acquired in-process research and development expense.
Revenues for 2002 grew 37% before a favorable foreign exchange effect. Including favorable foreign exchange effects, revenue rose 40% to $57.4 million from $40.9 million in 2001. Pro forma net income was $5.4 million compared to $4.4 million, an increase of 23%. On a diluted per share basis, pro forma net income was $0.20 compared to $0.17.
"Our fourth quarter and 2002 results are in line with the guidance we gave on our third quarter earnings conference call," said Chane Graziano, CEO of Harvard Bioscience. He continued, "as expected, the acquisition of Genomic Solutions, completed in late October 2002, contributed significantly to our revenue growth in the fourth quarter. The weak economic conditions during 2002 afforded us the opportunity to strengthen our product offerings in the high growth segments of the drug discovery market through the strategic acquisition of Genomic Solutions, BTX which was completed in January 2003, and the pending acquisition of GeneMachines. This is consistent with our strategy to offer a broad range of specialized products, focused in niche markets in drug discovery research."
On a GAAP basis, there was a net loss of $974,000 for the fourth quarter of 2002, compared with a net loss of $436,000 for the fourth quarter of 2001. Basic and diluted per share net loss was $0.03 and $0.02 respectively for the fourth quarter of 2002 and 2001. Both periods include charges for non-cash stock compensation expense of $299,000 for 2002 and $480,000 for 2001, amortization of intangibles of $462,000 for 2002 and $692,000 for 2001, and $152,000 and $460,000, respectively for the fourth quarter of 2002 and 2001, related to restructuring, all net of tax. For 2002, the net loss also includes charges related to the acquisition of Genomic Solutions of $1,551,400 for acquired in-process research and development expense and of $514,000 for fair value adjustments, expensed through cost of product sales, of acquired inventory and backlog related to orders shipped since the acquisition. In January 2002, the Company adopted Statement of Financial Accounting Standards (SFAS) 142, "Goodwill and Other Intangibles." SFAS 142 requires that goodwill and certain other intangibles no longer be amortized, but rather be tested annually for impairment. Accordingly, there was no goodwill amortization expense in the fourth quarter of 2002, compared to $382,000 in the fourth quarter of 2001.
HBIO ended the year with cash and cash equivalents of $15.3 million.
On a GAAP basis, net income totaled $736,000 or $0.03 per basic and diluted share for 2002. This compares with a net loss of $5.2 million, or $0.20 per basic and diluted share, for 2001.
As previously announced, investors can listen to a live web cast of the fourth-quarter earnings and an updated outlook by going to the Company's web site, http://www.harvardbioscience.com, or by dialing in to the conference call in "listen only" mode at (877) 313-7707. The conference call will begin at 10:00 am Eastern Time on Tuesday, March 4, 2003. If you are unable to listen to the live web cast, the call will be archived for two weeks on our website.
About Harvard Bioscience
Harvard Bioscience is a global developer, manufacturer and marketer of a broad range of specialized products, primarily scientific instruments, used to accelerate drug discovery research at pharmaceutical and biotechnology companies, universities and government laboratories. HBIO sells its products to thousands of researchers in 100 countries though its direct sales force, a 1,000-page catalog, various specialty catalogs and through its distributors, including Amersham Biosciences and PerkinElmer. HBIO has sales and manufacturing operations in the United States, the United Kingdom, Germany, Austria and Belgium with sales facilities in France, Canada and Japan.
The statements made in this press release that are not statements of historical fact are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements include, but are not limited to, statements about the Company's or management's beliefs or expectations, the Company's anticipated future revenues and earnings, the strength of the Company's market position and business model, the impact of acquisitions, the Company's business strategy, the positioning of the Company for growth, the market demand and opportunity for the Company's products, and the Company's plans, objectives and intentions that are not historical facts. Other factors that may cause the Company's actual results to differ materially from those in the forward-looking statements include the Company's failure to successfully integrate acquired businesses or technologies, expand its product offerings, introduce new products or commercialize new technologies or unanticipated costs relating to acquisitions, decreased demand for the Company's products due to changes in its customers' needs, financial position, general economic outlook, or other circumstances, plus factors described under the heading "Risk Factors" in the Company's Registration Statement on Form S-4 filed in connection with the acquisition of Genomic Solutions, or described in the Company's other public filings. The Company's results may also be affected by factors of which the Company is not currently aware. The Company may not update these forward-looking statements, even though its situation may change in the future, unless it has obligations under the federal securities laws to update and disclose material developments related to previously disclosed information.
For investor inquiries, please call (508) 893-8066. Press releases may be found on our web site, http://www.harvardbioscience.com.
HARVARD BIOSCIENCE, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2002 2001 2002 2001
Revenues $18,891 $11,907 $57,380 $40,868
Costs and Expenses:
Cost of product sales 9,323 5,738 28,310 20,180
Research and development
expenses 1,108 1,055 4,146 3,179
Marketing, selling, general
& administrative 6,756 3,365 17,623 11,841
------------------- --------------------
Total costs and
expenses (1) 17,187 10,158 50,079 35,200
Income from operations
(1) 1,704 1,749 7,301 5,668
Other income net 261 62 707 1,242
Income before income
taxes (1) 1,965 1,811 8,008 6,910
Income tax expense (2) (468) (739) (2,588) (2,521)
------------------- --------------------
Net income (1) (2) $1,497 $1,072 $5,420 $4,389
=================== ====================
Income per share (1) (2)
Basic $0.05 $0.04 $0.20 $0.17
Diluted $0.05 $0.04 $0.20 $0.17
Weighted average common shares
Basic 28,890 26,225 27,090 25,785
Diluted 29,285 26,913 27,597 26,382
(1) EXCLUDES STOCK COMPENSATION EXPENSE AND AMORTIZATION OF OTHER
INTANGIBLES FOR ALL PERIODS; EXCLUDES AMORTIZATION OF GOODWILL:
ACQUIRED IN-PROCESS RESEARCH AND DEVELOPMENT EXPENSE AND RESTRUCTURING
EXPENSE FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2001; AND EXCLUDES
RESTRUCTURING EXPENSE, ACQUIRED IN-PROCESS RESEARCH AND DEVELOPMENT
EXPENSE AND FAIR VALUE ADJUSTMENTS FOR INVENTORY AND BACKLOG RELATED
TO THE ACQUISITIONS FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31,
2002.
(2) EXCLUDES TAX BENEFIT (EXPENSE) RELATED TO ITEMS DESCRIBED IN
NOTE 1 OF $507 AND $124 FOR THE QUARTERS ENDED DECEMBER 31, 2002 AND
2001, RESPECTIVELY, AND $977 AND $731 FOR THE TWELVE MONTHS ENDED
DECEMBER 31, 2002 AND 2001, RESPECTIVELY.
HARVARD BIOSCIENCE, INC.
RECONCILIATION OF PRO FORMA NET INCOME TO U.S. GAAP NET INCOME (LOSS)
(In thousands, unaudited)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2002 2001 2002 2001
Pro Forma Net Income $1,497 $1,072 $5,420 $4,389
Stock Compensation Expense 299 480 1,269 2,679
Amortization of Goodwill and
Intangibles 462 692 1,543 1,744
In-Process Research and
Development Expense 1,551 1,551 5,447
Restructuring Expense 152 460 784 460
Fair Value Adjustment to
Costs of Product Sales 514 514
Income Tax Benefit 507 124 977 731
-------------------- ---------------------
GAAP Net Income (loss) $(974) $(436) $736 $(5,210)
HARVARD BIOSCIENCE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2002 2001 2002 2001
Revenues $18,891 $11,907 $57,380 $40,868
Costs and Expenses:
Cost of product sales 9,837 5,738 28,824 20,180
Research and development
expenses 1,108 1,055 4,146 3,179
Marketing, selling, general
& administrative 6,756 3,365 17,623 11,841
Stock compensation expense 299 480 1,269 2,679
In-process research and
development expense 1,551 -- 1,551 5,447
Restructuring expense 152 460 784 460
Amortization of goodwill and
other intangibles 462 692 1,543 1,744
------------------- --------------------
Total costs and
expenses 20,165 11,790 55,740 45,530
Income(loss) from
operations (1,274) 117 1,640 (4,662)
Other income net 261 62 707 1,242
Income (loss) before
income taxes (1,013) 179 2,347 (3,420)
Income tax (expense) benefit 39 (615) (1,611) (1,790)
------------------- --------------------
Net income (loss) $(974) $(436) $736 $(5,210)
=================== ====================
Income (loss) per share
Basic $(0.03) $(0.02) $0.03 $(0.20)
Diluted $(0.03) $(0.02) $0.03 $(0.20)
Weighted average common shares
Basic 28,890 26,225 27,090 25,785
Diluted 28,890 26,225 27,597 25,785
SELECTED CONSOLIDATED BALANCE SHEET INFORMATION
(In thousands, unaudited)
Dec. 31, Dec. 31,
2002 2001
Assets
Cash and cash equivalents $15,313 $29,385
Receivables 13,945 7,604
Inventories 15,467 5,973
Property, plant and equipment 5,918 3,506
Goodwill and other intangibles 51,055 33,195
Other assets 6,098 2,699
Total assets $107,796 $82,362
Liabilities
Total current liabilities $16,897 $12,156
Total liabilities 19,715 15,550
Shareholders' equity 88,081 66,812
Total liabilities and shareholders' equity $107,796 $82,362
CONTACT:
Harvard Bioscience, Inc.
David Green, 508/893-8999
Fax, 508/429-8478
dgreen@harvardbioscience.com
or
Chane Graziano, 508/893-8999
cgraziano@harvardbioscience.com
or
Susan Luscinski, 508/893-8999
sluscinski@harvardbioscience.com
Copyright © 2003 Business Wire. All rights reserved.
Disclaimer:
The information contained within this and other Harvard Bioscience Web pages should be deemed accurate and current as of the date of the most recent update, or if no update information has been provided, the date of issuance. Harvard Bioscience assumes no responsibility for any misincurrances or misstatements which occur as the result of the reading of dated material. Users are strongly encouraged to check dates of issuance and most recent update of any information contained within, or linked to, Harvard Bioscience’s web site. For Harvard Bioscience’s most current information please reference Harvard Bioscience public filings with the Securities and Exchange Commission located at http://www.sec.gov.